Arizona Real Estate License Practice Exam 2025 - Free Real Estate Practice Questions and Study Guide

Question: 1 / 1505

A vacant lot in Cave Creek is valued at $1,000,000. What would be the assessed value?

$100,000

$120,000

$150,000

The assessed value of a property is typically a percentage of its market value, as determined by local county assessors for tax purposes. In Arizona, the assessed value for vacant land is usually set at a percentage of its full cash value, which can vary but is often around 15% for residential property.

In this case, if the vacant lot in Cave Creek is valued at $1,000,000, applying the common assessment rate of 15% would result in an assessed value of $150,000. This calculation aligns with the formula for determining assessed value:

Assessed Value = Market Value x Assessment Rate

Using this method illustrates that the assessed value of the lot would be $1,000,000 x 0.15 = $150,000. This makes the choice of $150,000 accurate based on the standard assessment practices in Arizona, providing clarity on how assessed values are derived from market values.

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$180,000

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